Leaders target fraud, rule out Medicaid expansion for now

Updated 1:44 am, Thursday, January 17, 2013

AUSTIN — Top statewide officials are opposing a recommendation allowing counties to use local revenue to pay for expanded Medicaid coverage, and instead say they are targeting fraud and improving the quality of care within the state’s $30 billion program for the uninsured poor.

Lt. Gov. David Dewhurst said Wednesday that expanding Medicaid under the federal health care law is off the table “at the present time.”

He said he didn’t endorse the county option recommended by the Legislative Budget Board, which cited the proposal as a way to help relieve counties’ cost of charity care.

Last year, the Houston Chronicle reported that the use of both Medicaid-paid van service and pediatric rehabilitation therapy clinics that used the vans was higher in the Rio Grande Valley than any other region in the state.

Lack of service cited

A recent audit of the transportation program also found that some parents used the van service for unauthorized trips.

In various forms, Medicaid fraud totaled more than $6 billion in Texas between 2004 and 2011.

A second Nelson measure focuses on ways to improve long-term care for the developmentally disabled and elderly.

It’s important for the state to take steps including making every effort to prevent providers from defrauding the state, said Bee Moorhead, executive director of the interfaith advocacy group Texas Impact. But Moorhead said the legislation touted Wednesday “is not the heart of the matter.”

“The biggest Medicaid problem Texas has is (that) so many people should be getting it, but aren’t,” she said.

Moorhead said more than 1 million children are eligible for health care but aren’t getting services. She also noted the opportunity for Texas to add 1.6 million people to Texas Medicaid over a decade through the expansion.

The federal health care law offers an expansion of Medicaid to low-income adults who aren’t covered by the traditional program. About one in eight Texans, mostly children, relies on Medicaid for health care insurance or long-term services.

The federal government would cover the cost of expanding services for the first three years. States after that would pick up an increasing share, up to 10 percent.

Perry unconvinced

The Health and Human Services Commission estimates that the 10-year cost would be $15.6 billion in state funds, drawing $100 billion in federal funds.

Gov. Rick Perry remains convinced that it would be “irresponsible to add more Texans and pump more taxpayer dollars into an unsustainable system that is broken and already consumes a quarter of our budget,” said Perry spokeswoman Lucy Nashed. That goes for counties as well, she said.

Local officials said their first choice would be for Texas to expand the program statewide. That would provide a uniform program across Texas and ensure a funding source while relieving them of some of their costs of uncompensated care.

The Legislative Budget Board assumed the higher match would apply for newly eligible adults with a county-based expansion.

If counties were to do an expansion, local officials said it would be important for private hospitals to contribute, not just leave the cost to local taxpayers. They suggested a fee as one option.

David Lopez, president and chief executive officer of the Harris Health System, said, “If this becomes a local option, then … everybody needs to have skin in the game.”

Ron Cookston, executive director of Gateway to Care, a Harris County-based nonprofit collaborative focused on health care, said letting communities manage expansion could have a real benefit, but a state-level expansion would be preferable.

“If it is not done at the state level, there is going to be, community by community, variations in the services … ,” Cookson said. “That creates an infrastructure nightmare.”